Irish airline Ryanair has reported a 55 per cent rise in first quarter profits to €397m, but has still urged caution, while warning it could move its planes out of the UK entirely if no post-Brexit aviation deal is sorted in good time.
Chief executive Michael O'Leary has once more reiterated his stark warnings for aviation in the wake of the Brexit vote, saying today that the airline "remained concerned at the uncertainty which surrounds the terms of the UK's departure from the EU in March '19".
O'Leary expressed caution that when the UK leaves "there may not be sufficient time, or goodwill on both sides, to negotiate a timely replacement bilateral which could result in a disruption of flights between the UK and Europe for a period of time from April '19 onwards".
If we do not have certainty about the legal basis for the operation of flights between the UK and the EU by autumn 2018, we may be forced to cancel flights and move some – or all – of our UK aircraft to continental Europe from April '19 onwards.
The carrier reported a 55 per cent rise in first quarter profits to €397m beating analysts's expectations, with passengers up 12 per cent to 31.2m. It announced a rise in revenues to €1.9bn.
Over €200m has been returned to shareholders via share buybacks.
Despite the bright results, the carrier did emphasise that the outcome was "distorted" by the absence of Easter in the first quarter for the year before.
Shares fell nearly five per cent in early trading.
Ryanair said the cost gap between it and its competitors "continues to widen", delivering a six per cent unit cost reduction in the first quarter with a drop in its fuel bill, despite a 12 per cent rise in traffic, due to the lower oil price. It expects fares to fall by five per cent in the six months to the end of September, and by eight per cent in the six months to the end of March 2018.
Ryanair is calling the pricing environment to remain "very competitive" into the second half of the year.
It has raised its full-year traffic target to 131m, up by a million, and is guiding for profit after tax to come in at €1.4bn to €1.45bn.